Don’t do it. Don’t flip the page on that calendar. Don’t start
asking yourself what’s next for the NBA unless you really want to
know the depressing dose of reality waiting on the other side of
this year’s compelling finals. And whatever you do, if you want to
keep your sports sanity, don’t dare read this next sentence: On
July 1, the NFL and the NBA might both be facing simultaneous work
stoppages that could jeopardize the start of the next seasons for
both. Hey, you can’t say we didn’t warn you.
MIAMI
Don’t do it. Don’t flip the page on that calendar. Don’t start asking yourself what’s next for the NBA unless you really want to know the depressing dose of reality waiting on the other side of this year’s compelling finals.
And whatever you do, if you want to keep your sports sanity, don’t dare read this next sentence: On July 1, the NFL and the NBA might both be facing simultaneous work stoppages that could jeopardize the start of the next seasons for both. Hey, you can’t say we didn’t warn you.
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Although the possibility of delayed starts still remains the doomsday scenario, it unfortunately isn’t something anyone can guarantee against. Here’s why:
The NFL, which began enduring a lockout on March 12, is awaiting the outcome of an important decision from the 8th U.S. Circuit Court of Appeals on whether its lockout violates antitrust laws. Both sides began presenting arguments Friday.
Although some unexpected lawyer-free settlement talks also occurred in Chicago last week — providing some new hints of optimism about the future — the court’s decision on the appeal could create leverage for one side or the other that disrupts any progress.
“We can’t make a comment about it at all, but we’re trying,” Dallas Cowboys owner Jerry Jones told the Chicago Tribune after last week’s meetings. “We’re trying. I think the fact that we’re meeting is good.”
The NBA, meanwhile, is also trying — trying to avoid a July 1 lockout, but substantial differences remain. Commissioner David Stern said last week that it will be a “challenge” to strike a deal before the collective bargaining agreement expires June 30.
So what’s the percentage chance the NBA will jump into a lockout like the one being endured by the NFL? Well, that’s a topic that requires some serious explanations.
“I can’t answer that,” Stern said in a news conference before Game 1 of the Finals. “I don’t even want to make guesses, because I know both sides will make their best offers before the lockout. Because if they don’t, then there’s going to be a lockout that would be destructive. … Once you get into a lockout, everyone knows the offers get worse, not better.
“The question,” Stern added, “is whether the owners and the players will be bold enough to do what has to be done here.”
The NBA and the players union met in Miami on Wednesday and will convene at least twice in Dallas in the next several days. Stern believes progress was made at Wednesday’s four-hour session, but told The Associated Press, “I guess, on paper, we’re quite far apart.”
Union chief Billy Hunter emerged from Wednesday’s meeting “hopeful” that a deal can be reached after previously saying he was 99 percent sure of a work stoppage.
“We’re going to put in as much time as we have just to see if we can make any progress,” Hunter said.
In other words, at least from a timeline standpoint, the NBA’s sentiments are mirroring the comments that were being made by the NFL’s own power players at around the time of the Super Bowl.
But don’t be fooled into thinking these two situations are exactly the same. Although the NFL never has contended to be losing money — even if it isn’t being entirely open about how much it is making — the NBA is painting a much more dire picture of its landscape. Because the NFL’s issues have been discussed for months, allow us to explain the major issues about to be facing the NBA.
The NBA is intent on making significant changes because 22 of the league’s 30 teams are expected to lose money this season, according to deputy commissioner Adam Silver. Stern said the league is on course to lose $300 million this season after losing $370 million and $340 million the past two seasons. The losses have dropped because of an attendance increase. At the root of the NBA’s problem, Silver said, is the fact that costs have risen faster than revenues since the current labor deal was ratified in 2005.
Under the current system, players receive 57 percent of the BRI (basketball-related income) after some expenses are deducted. The owners want that percentage reduced and also want more expenses taken off the top, with the hope of reducing annual player costs by $750 million.
“Costs have risen much faster than revenues over the course of this deal,” Silver said, as he sat alongside Stern at Tuesday’s news conference at AmericanAirlines Arena. “The last year of the prior deal, our gross revenues were essentially rising 10 percent a year.
“Two years ago, revenues increased 3 percent. Last year, 1 percent. This year, probably somewhere between 3 and 4 percent. At the same time, the built-in increases of our contracts are much higher than inflation and the growth of our business.”
As an example, Silver said, “the three key players on the Miami Heat all have 10{-percent increases built into their deals for next season at a point where revenues in our business are growing somewhere around 3 percent. It’s a broken system.”
Here is the league’s idea to fix it:
Implement a hard salary cap, far more restrictive than the current $58 million soft cap that allows teams to exceed that number to re-sign their own players. The league also might try to close other loopholes, such as awarding exceptions to capped-out teams to spend on other teams’ free agents.
Roll back salaries on existing contracts.
Make contracts only partially, not fully, guaranteed.
Shorten the length of contracts and the maximum that can be paid to elite players.
Negotiations with the union ultimately will determine how many of those ideas will be implemented.
Predictably, players have balked at the notion of a hard salary cap and rejected a May proposal in which a hard cap would not be enacted until the 2014-15 season.
If there is a hard cap, it would make it challenging for the Heat and other teams that have multiple players earning the maximum salary, or close to it. Asked by The Miami Herald if he would like to avoid the breakup of All-Star casts such as the Heat’s, Stern was vague.
“That’s part of the negotiation,” he said. “This is very complex. It’s going to involve a lot of working together with the union, with the full confidence of both the players and the owners that if there’s a will, we’ll be able to work out all those issues.”
Stern said a “franchise tag” similar to the NFL’s has not been proposed, but “we have historically tried to make it more attractive for players to stay with his current team, and I’m sure that trend will continue, if not be enhanced.”
The league reportedly has discussed granting a one-time amnesty clause to allow teams to buy out a player and pay his full salary, but not have to count it against the cap. Though both sides prefer to avoid having the courts settle their differences, the players recently filed a charge against the NBA with the National Labor Relations Board, alleging unfair bargaining practices.
“You will see that will be a difficult charge to sustain, to say the least,” Stern said. “I’m guessing some players have started dialogue with an owner saying something about not wanting his contract to be changed or something, or an owner saying, ‘Don’t worry about that. We’ll be making a new offer or whatever.’
“And the union, for whatever reason, got themselves a lawyer that thought he would put together an unfair labor charge. We’re not concerned.. . . That’s part of the challenge, really, whether we’re going to be bold enough to negotiate as opposed to posture.”
As has been the case with NFL negotiations, trust appears to be an issue. Hunter told ESPN Radio’s Stephen A. Smith in April that he doesn’t believe the league is losing $300 million.
“I don’t accept that,” Hunter said. With attendance, TV ratings and merchandise sales all up this season, “I can’t imagine how in the face of all this that they can continue to lose money.”
The players have encouraged the NBA to solve its problems by increasing revenue sharing, similar to the way the NFL and Major League Baseball operate, where high-revenue teams distribute lots of money to the low-revenue teams.
“That’s something we are pushing hard,” Hunter said in that ESPN Radio interview. “But some of the major markets are not interested in sharing revenues to the tune it’s being shared in the NFL.
“The NBA has the weakest revenue-sharing plan of any of the professional sports, and we’ve heard people like Jerry Buss and others on the Lakers indicate they’re not interested in having to share the revenue with some of these other teams.”
But Stern didn’t discuss revenue sharing at length in Tuesday’s news conference, but said in April: “Our goal to have a significant revenue-sharing policy in place when we conclude our collective bargaining negotiations is very much our target.”
Because the playoffs have absorbed attention, there hasn’t been as much focus on an NBA lockout as there was in the weeks before the NFL lockout.
“I think the amount of chatter in the marketplace has been nothing like what the NFL is hearing,” Silver said. But the threat of one “is having a great impact on our business,” he said. “Both our marketing partners and our licensees who need to plan in the normal course of business are unable to make their normal media buys, place orders.
The last NBA lockout shortened the 1998-99 season by 32 games, to 50, and also resulted in the cancelation of an All-Star Game.
“The goal,” Silver said, is “to create a system in which all 30 teams can compete for a championship. And if well-managed, have the opportunity to make a profit.”
In other words, soak up these current finals. Enjoy them for every bit of excitement. Because when they eventually end, you most certainly aren’t going to be enjoying what is waiting on the other side.
— Story by Barry Jackson and Jeff Darlington, McClatchy Newspapers
